Asian shares fall after US tech falters, dollar and yields hold gains
Asian shares fell on Friday after Tesla and Netflix weighed on U.S. tech shares after their earnings reports, while the dollar and Treasury yields held their gains ahead of an action-packed week that could see the end of the U.S. tightening cycle.
As well as the U.S. Federal Reserve meeting next week, the Bank of Japan will meet amid speculation of imminent policy tweaks. Early on Friday, Japan's inflation stayed above the central bank's target of 2% for the 15th straight month in June, but gains matched a median market forecast.
MSCI's broadest index of Asia-Pacific shares outside Japan dropped 0.5%, heading for a weekly loss of 1.8%. Japan's Nikkei, meanwhile, lost 0.3%. Shares of Taiwanese chipmaker TSMC slumped more than 3% on Friday after the world's largest contract chipmaker flagged a 10% drop in 2023 sales.
China's bluechips dipped 0.2% while Hong Kong's Hang Seng index bucked the trend with a gain of 0.4%. The onshore yuan was 0.2% higher at 7.1674 per dollar after the central bank set a much stronger guidance rate than expected. Authorities have recently stepped up efforts to defend a weakening currency, alongside yuan-buying trades by state-owned banks.
Concerns are also brewing over the health of Chinese property developers, after rating agencies warned Wanda Commercial could default on its debt repayment. On Wall Street, after rallying almost 40% since the turn of the year, the Nasdaq fell 2% overnight, the biggest one-day loss since March, driven by steep post-earnings plunges in mega tech stocks Tesla and Netflix. [.N] The electric-vehicle maker reported a drop in its second-quarter gross margins to a four-year low while the streaming video company's quarterly revenue fell short of estimates.
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